TIDMCORD
RNS Number : 3323X
Cordiant Digital Infrastructure Ltd
04 May 2021
LEI: 213800T8RBBWZQ7FTF84
This announcement has been determined to contain inside
information for the purposes of the UK version of the market abuse
regulation (EU) No.596/2014.
Cordiant Digital Infrastructure Limited
Capital Deployment and Enhanced Dividend Guidance
4 May 2021
The Board of Cordiant Digital Infrastructure Limited (the
"Company") is pleased to announce the deployment or commitment of
substantially all of the net proceeds from its Initial Public
Offering ("IPO") into digital infrastructure platforms in the Czech
Republic and Norway, as well as an acceleration of the growth in
targeted dividends.
Key Highlights
-- Substantial deployment in less than 3 months. Having
completed the IPO in February, the Company has now either committed
or reached agreement to deploy substantially all of the net
proceeds of the IPO into two attractive and complementary
transactions. The resulting portfolio of assets will include 660
TV, radio and telecommunications towers, 3,000 microwave
connections, a network of 4 ,850km of optical fibre and 6 edge data
centres.
-- Diversification. The investment provides exposure to a
diversified array of underlying digital infrastructure assets
(mobile telecom and broadcast towers, fibre and edge data centres)
through platforms with strong competitive positions, long-term
contracts and attractive growth opportunities. The acquired
platforms produced in aggregate estimated EBITDA of circa GBP 40.5
million over the 12 months ended 31 December 2020.([1])
-- Advanced pipeline. The Company's pipeline of further,
well-advanced and complementary transaction opportunities (across
the U.S., Canada, Scandinavia and other European markets) has grown
considerably since the IPO.
-- Substantial increase in dividend guidance. A dividend per
share of no less than 3 pence per share is now targeted for the
current financial year, an increase from 1 pence per share.
Deployment of IPO Proceeds
The Company has completed the acquisition of České
Radiokomunikace (" CRA") and entered into a legally binding letter
of intent (subject to confirmatory technical due diligence and
final transaction documentation) to acquire a Norwegian fibre
network and certain land for data centre development for a combined
total consideration of GBP 451 million, comprising GBP 318 million
of equity and the assumption of an amount equal to GBP 133 million
of debt. The acquisitions of CRA and the Norwegian assets provide
the Company with a base of stable, cash generative assets with
long-term contracts in operational areas the Cordiant Capital team
understands well. Moreover, each of the new platforms accords
attractive opportunities for further, accretive capital
investment.
Following the completion of the Norwegian acquisition, the
Company will have uninvested proceeds from the IPO of approximately
GBP 43.4 million.
The Company's pipeline of attractive, advanced opportunities in
North America, Scandinavia and other parts of Europe has increased
in size and evolved in a positive direction since the IPO. The
Company's strategic approach and long-term investment thesis has
been well received in the market; the Company consequently enjoys
an available pool of high-quality opportunities in the various
sub-sectors of digital infrastructure (both internally sourced
transactions and those introduced through market
counterparties).
CRA
CRA is a leading independent digital infrastructure platform in
the Czech Republic; it also holds the national broadcast license.
It is a highly successful digital infrastructure platform with
contracted, long term, growing revenues in a strong and dynamic
Central European country demonstrating rapid convergence with the
economies of the European Union's historic core. The assets include
a portfolio of digital broadcast towers that would be challenging
to replace or replicate, a nationwide network of mobile towers, an
optical backbone network, and a portfolio of strategically located
data centres. The Czech Republic has a number of unique attributes
supporting the long-term potential of the CRA business, including
historically robust demand for broadcast entertainment in the Czech
Republic to a population distributed in a manner well-suited to
CRA's network.
Growth opportunities for CRA exist in supporting the mobile
operators with infrastructure as well as in expanding the size and
reach of the data centre platforms. There is significant potential
to expand CRA's early, successful, network offerings in the
"Internet of Things". The network already offers smart metering for
water, electricity and gas for companies including E.ON and
RWE.
The Company looks forward to working with CRA's experienced and
accomplished management team.
Fibre Optic Network Acquisition - Norway
The Company has entered into a binding letter of intent to
acquire an extensive fibre-optic network linking regions of Norway
to Scandinavia and the population densities of the core of Europe
beyond. Customers include telecommunications operators, industrial
concerns and utilities who have signed long-term contracts and for
whom the fibre connectivity is of critical importance.
Approximately half of the network's fibres have currently been
leased, offering significant potential to increase revenues with
existing and new customers (such as data centre operators). The
region offers the least expensive, most environmentally friendly
and abundant electrical power in Europe with attractive low
operating costs for data centre operators. As such, Scandinavia is
expected to attract increasing investment in data centres and
require augmented fibre optic capacity.
In addition, the Company has signed an agreement to invest in
strategically-located Norwegian land parcels with substantial power
availability. These offer significant development potential for
data centre operators, thereby providing the Company with a
potential base on which to grow a Nordic data platform.
Enhanced Dividend Guidance
The Company is pleased to announce its intention to pay a
dividend of 3 pence per share in respect of its first financial
year ending 31 March 2022. This is an increase from the 1 penny per
share targeted at IPO. A maiden dividend of 1.5 pence per share is
now targeted for payment in December 2021 with respect to the half
year to the end of September 2021 and a further dividend of 1.5
pence per share is now expected to be paid in July 2022 for the
period ending March 2022.
The Company intends to pay a progressive dividend in future
years and is targeting a further acceleration of the dividend
timetable, previously announced at the time of the IPO, which
envisioned a dividend of at least 4 pence per share in the fifth
full financial year.
Steven Marshall, Chairman Digital Infrastructure, Cordiant
Capital Inc. said:
"We are delighted to have acquired these attractive digital
infrastructure platforms. CRA is a national champion with an
unrivalled portfolio of assets in a core European country. We are
excited to be partnering with their strong management team, its
employees, and other stakeholders in order to continue building CRA
as a leading digital infrastructure platform serving the broadcast,
telecommunications and data centre markets.
"The Norwegian long-distance fibre-optic network is profitable
and ideally located to support future growth in the digital
infrastructure market in Scandinavia. We look forward to supporting
further expansion and growth of this network with the existing
management team."
Shonaid Jemmett-Page, Chairman of the Company , said:
"Our Manager has been able to swiftly deploy the substantial
majority of the IPO proceeds into compelling platform transactions,
in addition to developing an advanced pipeline of further
investment opportunities. These significant maiden investments
provide an attractive source of income and we are pleased to be
able to announce a significant acceleration in the quantum of
dividends that the Company intends to distribute."
Analyst & Investor Call at 10am
The Manager will host a conference call for analysts and
institutional investors at 10am. Please contact the Company's
Financial Communications Adviser for participation details (
CordiantDigitalInfra@Camarco.co.uk ).
Enquiries:
For further information, please contact:
Cordiant Digital Infrastructure Management
Ltd
Manager
Stephen Foss, Investor Relations +44 (0)20 7201 7546
Investec Bank plc
Corporate Broker +44 (0)20 7597 4000
Tom Skinner (Corporate Broking)
Lucy Lewis, David Yovichic, Denis Flanagan (Corporate Finance)
Dominic Waters, Will Barnett, Neil Brierley (Sales)
Camarco +44 (0)20 3757 4980
Financial Communications Adviser CordiantDigitalInfra@Camarco.co.uk
Louise Dolan
Eddie Livingstone-Learmonth
Monique Perks
Billy Clegg
Ocorian Administration (Guernsey) Limited
Company Secretary and Administrator
Ian Smith
Holly Tierney + 44 (0)1481 742742
Notes to Editors:
Cordiant Digital Infrastructure Limited primarily invests in the
core infrastructure of the digital economy - data centres,
fibreoptic networks and broadcast and telecommunication towers -
"the plumbing of the internet" - in the UK, Europe and North
America. Further details of the Company can be found on the
Company's website at www.cordiantdigitaltrust.com.
Cordiant Capital Inc., the Company's investment manager, is a
sector-focused investment manager with particular expertise and
experience in digital infrastructure. Cordiant invests in global
infrastructure and real assets, running infrastructure private
equity and infrastructure private credit strategies through limited
partnership funds and managed accounts. Cordiant's current client
base consists of global insurance companies, pension plans and
family offices.
([1]) EBITDA figure is presented on a pre-IFRS 15 & 16
basis, excluding one off items and is based on CZK-GBP and NOK-GBP
average exchange rates for the year 2020.
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